ACTIVITIES OF FAO AND WFP

5. In accordance with Rule VII-1 of the General Rules of the Organization (GRO), the Council agreed to put the following nominations before the Conference:

Chairman of the Conference

:

Faisal Abdul-Razzak Al-Khaled (Kuwait)

Chairman of Commission I

:

C.S. Sastry (India)

Chairman of Commission II

:

Fred J. Eckert (United States of America)

Chairman of Commission III

:

Jozef Wiejacz (Poland)

The nomination for Chairman of the Conference was made after a vote in Faisal Abdul-Razzak Al-Khaled (Kuwait) received 27 votes and Colin J. M (New Zealand) received 20 votes. 2

6. A number of members felt that this decision had abrogated the long-established principles of rotation. Many members pointed out that disagreement had not been over the principle of rotation but over the v which it should be applied and that this divergence of views had been by democratic process.

8. The Council endorsed the Report of the Fifty-sixth Session of the Committee on Commodity Problems (CCP). It commended the Committee and its subsidiary bodies for the valuable work that they were continuing to undertake.

9. The Council underlined that the world agricultural commodity trade situation remained in a profound state of crisis, affecting all countries, both developed and developing ones. It expressed particular concern that the terms of trade of most agricultural exports of many countries and in particular of developing countries had continued to deteriorate sharply in 1986 and 1987 and that there were, on the whole, only slight grounds for optimism about the growth of this trade in the short term as fundamental factors such as ample supplies of most commodities and only slow growth of import demand was likely. The Council stressed the need for lasting solutions to the crisis facing world agricultural trade.

10. The Council recognized that the severely low levels of agricultural
export prices in recent years resulted from such factors as the large
overhangs of stocks and in some cases improvements in productivity which had
occurred in many instances due to high levels of domestic support. At the same
time, agricultural policies, particularly in many developed countries, had
continued to curb trade opportunities for other countries and to exacerbate
competition for markets, especially through the use of export subsidies. The
Council emphasized that at the root of the disarray in agricultural trade were
inappropriate policies applied to agriculture. The Council therefore stressed
that domestic policy measures which distorted trade should be reformed as well
as measures which directly impinged on trade. It considered, however, that
domestic agricultural policies which had clear developmental, social and
environmental aims without distorting trade, should not be called into
question.

11. In this connection, the Council welcomed some major initiatives and
proposals which had been set out recently by a large number of countries and
groups of countries concerning principles and approaches to guide agricultural
policy reform, including those of the Cairns Group, the Group of 77, the OECD
(Organization for Economic Cooperation and Development) Ministerial Communiqué of May 1987, the outcome of the Venice Summit of leaders of major industrialized countries, the new EEC (European Economic Community) Regulation on Agricultural Reform as well as the proposals made in the context of the GATT (General Agreement on Tariffs and Trade) negotiations on agriculture and tropical products. It expressed the hope that action to ensure concerted reform of agricultural policies would soon lead to concrete results.

12. The Council strongly deplored protectionism in agriculture, in
paiticular the practice of heavily subsidized production and exports, and
regretted that its dimensions and the problems resulting from it had seriously
worsened in recent years. It therefore urged that the goals set out in the
Ministerial Declaration on the Uruguay Round of GATT Multilateral Trade
Negotiations be achieved as soon as possible, particularly in relation to
agricultural trade, and called on countries, particularly those pursuing protectionist policies, to comply closely with the standstill commitments in the Ministerial Declaration, and to proceed with agricultural policy reforms as soon as possible, in line with the rollback agreed in the Declaration.

13. The Council expressed particular concern about the severe constraints on
the developing countries' development efforts caused by the heavy burden of
external debt, inadequate inflows of capital, widespread protectionism and
depressed terms of trade.

14. The Council agreed on the need for progressive elimination of
protectionist agricultural policies and stressed that the interests of
developing countries should receive priority attention in the Uruguay Round.
In particular, it urged the achievement of the fullest liberalization of trade
in tropical products, including in their processed and semi-processed forms,
and that the principle of differential and more favourable treatment for
developing countries be applied in the negotiations on agriculture.

15. The Council welcomed the invitation that the Contracting Parties to the
GATT had extended to FAO to attend the meetings of the Negotiating Group on
Agriculture and the Negotiating Group on Tropical Products. The Council hoped that the experience and knowledge of FAO in food and agriculture would therefore contribute to progress in the Uruguay Round in these sectors. The Council stressed that FAO's expertise should also be available to interested countries in making their preparations for the Uruguay Round negotiations.

16. The Council considered that the understandings reached at the United
Nations Conference on Trade and Development (UNCTAD) VII pointed towards an
improvement in international relations concerning several economic issues. In
particular, it welcomed the recognition by UNCTAD VII of the need for the
better functioning of commodity markets and the desirability of achieving
stable and more predictable conditions in commodity trade. The Council also
noted that the recent ratifications of the Agreement Establishing the Common
Fund had greatly enhanced the possibility of the Fund becoming operational at
an early date. The Council expressed the hope that the progress made on these
issues would give an impetus to furthering multilateral cooperation on
commodity problems.

17. The Council recognized that the considerable potential for expanding
trade among developing countries in agricultural commodities had not been
fully developed and, in order to promote such trade, a flexible approach in
economic cooperation was required. This could include progressive removal of
tariff and non-tariff barriers affecting such trade, as well as direct trade
promoting measures such as bilateral agreements, long-term contracts, joint
ventures and multi-sectoral arrangements. Also, supportive measures such as'
dissemination of trade information, improvement in the quality and
competitiveness of export products as well as transport, communications and
finance would be crucial elements of efforts to facilitate the expansion of
this trade.

18. The Council, while recognizing that the responsibility for promoting
Economic Development among Developing Countries (ECDC) in trade was primarily
that of the developing countries themselves, agreed that the developing
countries needed to be supported and assisted by developed countries in these
efforts. It agreed that FAO should continue to support efforts of developing
countries to promote ECDC in trade in agricultural products, particularly in the area of providing information on market opportunities and through continuing analyses of the scope for this trade.

19. The Council endorsed the work of the Intergovernmental Commodity Groups
(ICG), stressing their usefulness as fora for countries to consult together on
the situation, prospects and issues facing the commodities concerned and to
identify possible measures to improve the conditions of trade. Some members
expressed regret that the number of ICG meetings had tended to diminish in
recent years due to budgetary difficulties and hoped that resource constraints
would not cause the planned meetings on commodities to be cancelled or
postponed. Regarding the Intergovernmental Group on Oilseeds, Oils and Fats,
the Council noted that the Committee, with the exception of the EEC member
countries, had reiterated its indignation, vigorous protest and strong concern
about the proposal by the EEC Commission to introduce a stabilization
mechanism in the vegetable and marine oils sector. The Council, with the
exception of EEC member countries, noting the opposition of third-country
trading partners to the proposal, reiterated the appeal to the Governments of
the EEC member countries and to the EEC Council of Ministers to reject the
stabilization mechanism proposed by the EEC Commission.

20. The Council welcomed the continuing consultative and monitoring
functions of the Committee on Surplus Disposal (CSD) which aimed at
contributing to the orderly disposal of agricultural commodities as food aid
and on other concessional terms. In particular, the Council considered the
. availability of accurate and reliable trade statistics to the CSD as indispensable and appreciated that FAO had provided this service for rice since 1983. It agreed with the CCP and CSD recommendations that FAO continue this service and urged the cooperation of CSD members in providing relevant information. The Council supported the efforts made by the Chairman of the CSD to enlarge the membership of and attendance at CSD especially of food aid recipient countries, and invited all interested FAO member countries which had not already done so to join the CSD and participate actively in its proceedings.

21. The Council fully supported the broad lines of the proposed programme of
work in the field of commodities and trade for the 1988-89 biennium. It
expressed support for commodity intelligence activities and placed high
priority on analytical reports prepared by the Organization in this area. It
also considered that the FAO Intergovernmental Commodity Groups provided
valuable fora for producing and consuming countries to exchange information,
to identify problems facing the commodities and to consider remedial measures.
The Council supported the FAO Secretariat's collaboration with other
international organizations concerned, and especially with UNCTAD and GATT. It
also supported the priority given to the furtherance of ECDC in the work
programme for 1988-89 as well as the provision made to continue technical
assistance to interested countries in strengthening and implementing national
commodity policies.

22. The Council was informed, through document CL 92/2, of progress on the
Implementation of the International Code of Conduct on the Distribution and
Use of Pesticides. Additional up-dating information was provided by the
Secretariat. The Council noted that, through a questionnaire, a baseline survey had been carried out for current practices related to the distribution and use of pesticides and that so far 87 countries had provided the necessary replies.

23. An analysis of 77 replies was presented, and the. areas in which
governments felt improvements to be necessary were identified. These included
the establishment of appropriate legislation and regulatory capabilities in member countries, the training of all personnel concerned, the further improvement of trade practices in particular with respect to types of pesticides available, and the necessary advice on their appropriate use. The answers to the questionnaire highlighted the need for better information on possibilities for treatment of pesticide poisoning. Disposal of pesticide waste and containers was also identified as a major concern. The close interaction between activities related to the Code and the FAO integrated pest management programmes was emphasized.

24. While member countries have the primary responsibility with respect to
the implementation of the Code, the Council noted that strong support was
being provided by various environmental groups, notably the International
Organization of Consumers Union (IOCU), the Pesticide Action Network and by
industry through the International Group of National Associations of Agro-
chemical Manufacturers (GIFAP). The Pesticide Action Network was closely
involved in monitoring the implementation of the Code and had published the
results of studies carried out in a number of developing countries. The GIFAP
had adopted the policy that no national organization could be a member unless
it observed the Code. In addition, GIFAP had prepared guidelines for its
members and associated industries giving specific instructions on the
implementation of the Code. The GIFAP had also closely cooperated with FAO in
the preparation of pictorial labelling or so-called pictograms.

25. The Council agreed that the Code was useful in assisting countries to
improve the safe and effective use of pesticides and that it represented one
of the most important technical activities undertaken by FAO in recent years.
The Council commended FAO for the action undertaken on this complex issue and
urged that high priority continue to be given to matters related to the Code,
in particular, to the effective monitoring of its implementation. It
emphasized the necessity of continuing close cooperation with other UN (United
Nations) agencies such as the United Nations Environment Programme (UNEP), the
United Nations Industrial Development Organization (UNIDO) and the World
Health Organization (WHO), It noted that cooperation had also been established
with the World Bank with reference to training and technical assistance
programmes planned by FAO.

26. The Council recalled the dynamic nature of the Code, the need for
monitoring its observance and for periodic revisions to effectively meet
changing conditions. The Twenty-third Session of the Conference in adopting
the Code had "recommended that such revisions be made after some experience
had been gained in the implementation of the Code". Most members recalled that
they had urged, during the Twenty-third Session of the Conference, that the
first revision be. made during the. current biennium. They were convinced that
time had now come for an amendment of the Code, notably in order to introduce
the concept of "prior informed consent" (PIC). Other members felt, however,
that insufficient experience had been gained so far, and that adoption of
revisions should be preceded by a more complete implementation of the Code and
by technical consultations.

27. The Council felt that most developing countries would require technical
assistance and training in implementing the Code, and noted with satisfaction
the assistance already provided by the Government of Japan and the prospect of
further assistance from that country and from the United Nations Development
Programme (UNDP). A number of countries indicated that further resources
should be sought to accommodate the needs of all developing countries
requiring assistance.

28. Although there were differences of views on the matter, the Council
recommended that an item on the Progress Report on the International Code of
Conduct on the Distribution and Use of Pesticides be added to the Agenda of
the forthcoming Twenty-fourth Session of the Conference.

29. The Council expressed its satisfaction with the documents, which fully
covered coordination between FAO and the other organizations of the UN System.
The Council commended the analysis of recent developments in the UN System.
The Council noted that the conclusions reached at its Ninety-first Session
regarding operational activities for development had been submitted to the
Economic and Social Council and were under discussion at the Forty-second Session of the General Assembly, together with the JIU (Joint Inspection Unit) Report on field operations. In this context the Council also noted the wider process of reform which was under way in the United Nations.

30. The Council welcomed the submission of a report by the Director-General on the control of the locust and grasshopper infestations in Africa to the Economic and Social Council at its second regular session in 1987 , as requested by General Assembly Resolution 41/185.

31. The Council supported the steps taken by FAO to participate fully in and to support the UN Programme of Action for African Economic Recovery and Development, 1986-1990.

32. The Council expressed its satisfactioon with the imporvements which had taklen place in the field between FAO and other organizations of the UN System. It reiterated its view that coordination was working well at the country level.

33. The Council noted that these documents would be taken up at the forthcoming Twenty-fourth Session of the Conference.

2 After the vote, the Chairman of the Group of Nordic countries declared that in the opinion of these countries the agreement obtained in the Council to nominate the Chairman of the Conference had deviated from the traditional principle of rotation and thereby violated one of the fundamental rules governing harmonious international cooperation. The Nordic countries may therefore challenge this recommendation at the beginning of the Conference.